Healthy families are the foundation for healthy communities. There is nothing more important than good health, and reliable healthcare for the family. Universal health coverage aims to ensure that all people receive quality and adequate healthcare without suffering financial hardship. The biggest challenge is to combat the multiple scourges ravaging the world’s poor and sick. We are facing more pressing health challenges than ever before and health-related expenditure has now become a primary route to impoverishment and bankruptcy.

India took a great leap in public health insurance when it launched a national healthcare insurance programme. The Prime Minister Jan Arogya Yojana (PMJAY) and the Ayushman Bharat ~ meaning “Long Life India” ~ insurance scheme formulated alongside are the country’s flagship structures created to help universalise health care. They are intended to ensure that economically vulnerable families get the medical care they need without being pushed deep into debt. The cost to the government is around Rs 1,052 per family, with 60 per cent borne by the Central government and the rest by participating states.

Although the scheme has several laudable objectives and novel features, it has its own limitations. Despite having an apparently formidable beneficiary base, AB-PMJAY still has a small share in the overall in-patient care provision. This is due to low empanelment of hospitals, a general reluctance of private providers towards dispensing ABPMJAY benefits, and limited contribution of AB-PMJAY to the overall business of hospitals. The government pays public and private hospitals fixed rates for treating people covered under the programme and this doesn’t fit in with the viability of the private sector.

New ways will need to be explored to see how the private sector can be co-opted in the delivery of public health. At the same time, the public health system ~ particularly in rural India ~ will have to be regenerated. For the poor, health is often the dividing line between the path to prosperity or a slide into destitution. To make matters worse, the combination of typically volatile and precarious incomes and the absence of good quality healthcare means low-income communities not only need access to health care, but also the ability to pay for it.

Private healthcare has catastrophic costs that shave off hard-earned savings of patients and their families. The repercussions go far beyond the ailing patient. They have spillover consequences, resulting in less money being available to households for food, education, housing and other necessities. A health event is a bigger risk to farmers than an unsuccessful crop. Once they sell their land or livestock, they become indentured labourers and that takes a generation or more to fix. Care at India’s public hospitals is technically free. But in reality the poor quality of care and a lack of human resources and equipments have impeded them from properly coping with overwhelming patient loads.

As a result, many poor Indians have been forced between seeking treatment in costly private hospitals, often pushing families back into poverty, or simply going without care. Not only are there steep medical costs involved in a health episode, but there are also incidental expenses. This is further compounded by the loss of income during the period an individual is ill/injured or caring for an ailing loved one. Without insurance, people often turn to informal means to manage these risks ~ but such strategies provide inadequate protection.

So when misfortune strikes, many get drawn into debt traps as they borrow beyond their means. This can lead them to sell productive assets, take children out of school or put them to work, compromise on food, or leave other illnesses untreated. Due to this dynamic, a health issue can easily become a financial sinkhole. Health insurance serves two primary functions for individuals. First, insurance secures financial access to health care for individuals both for preventive services and treatment. Second, it evens the costs of those services, protecting against potentially devastating economic shocks that can occur as a result of care-seeking.

Health insurance policies in India typically don’t cover outpatient or domiciliary treatment, where the major expenses involve pharmacy bills, diagnostic and pathological tests, etc. Several health insurance programmes cover wage loss on account of illness or other health-related issues, but many don’t. Due to these coverage gaps, even insured beneficiaries can incur high indirect costs ~ especially in cases that require hospitalization. For instance, India’s flagship public health insurance scheme, Ayushman Bharat, fails to recognize and compensate the indirect costs associated with hospitalisation ~ and these are quite significant for the poor. These include expenses on travelling to the hospital and back.

Additionally, staying in a hospital or at home, after hospitalisation, implies a loss of wages. Often, attending caregivers from the family also have to forgo wages for several days. They also have to arrange for their lodging and boarding in case the treatment is being undertaken away from their native town. Poor households may take on debt, selling productive assets ~ or even their own homes. This risks a negative feedback loop: Poverty leads to bad health, which generates further poverty. They may be forced to avoid or delay treatment, as they cannot afford to lose their wages.

Similarly, those who need longer-term hospitalisation may go back to work even if they have not fully recovered. Lost income due to missed work, often one of the largest components of a financial shock, is far lower among the insured, because insurance allows them to seek care sooner. Since many of the concerns of women are not easily insurable, e.g., maternity costs, a more relevant product would be one that combines insurance and savings. In this way, for example, a woman could use her savings to cover the cost of normal delivery, and insurance to cover the cost of unexpected complications.

In evaluating the success of Ayushman Bharat, what matters, even more than the beneficiaries’ count, is whether it removes the need in the target population to prioritise livelihood over their daily needs. This is normally the case for most poor families who lack income support during the treatment. It can also consider including primary day-to-day healthcare instead of just secondary and tertiary care. The former is the bedrock of a robust health-care system but is tragically the weakest link in the provision of public health in India.

An important reasoning is that poorly delivered primary care inevitably increases the burden on health and finance at the secondary and tertiary levels down the line. Nurses and practitioners of traditional Indian medicine will have to take “bridge courses” to keep abreast of the bewildering forms of new diseases. Diseases are not static things. Pathogens change, hosts change, and environments change. Our immune systems change as well, as a result of fending off infections. And, of course, our lifestyles change, as also social standards, medical systems, and public-health programmes. Thus, it is necessary to enlarge the benefits to include loss of wages and incidental expenses during hospitalisation.

This is already the prevailing practice of specific comparable schemes. Such plans provide a “hospital cash” benefit or “wage loss” benefit, which is a fixed amount for transportation and wage loss for each day of hospitalisation. Some plans in developing countries provide a fixed amount to the beneficiary for each night of hospitalisation, irrespective of the actual expenses incurred. This top-up coverage can be used with any other social security scheme that members may enroll in. The enhancement of the coverage could make the scheme truly pro-poor.

And, considering that this added benefit would be conditional on prior hospitalisation, there is no risk of moral hazard or unwarranted claims. Private health insurance has been popular among the middle class. Once it percolates to the general masses, there will be competition to Aysuhman Bharat which will necessitate improvements in order to cope with the competition. Star Health ~ the first and the largest standalone health insurer, founded in 2006 ~ proved that health insurance was a big market ~ but the general thinking was that health is more difficult than motor, fire, etc. to underwrite and to sell.

Everyone expected health insurance to grow faster than motor insurance as health is a basic need, not a car or a two-wheeler. The prediction has come true despite motor insurance being mandatory in India. And about half a dozen standalone health insurers (such as Max Bupa, Manipal Cigna and Star Health) have made all the difference by expanding health insurance coverage faster than about a dozen general insurers that sell motor, fire and other forms of insurance in addition to health. Universal health coverage will become a reality only if individuals, families, and communities are empowered to identify their own health needs and take action to address the diseases that increase cost of care and contribute to the burden on our health systems.

It is the government’s primary job to invest in a dependable state-run system and also devise regulation that keeps players, public and private, committed to serving the national interest. Several laudable policies are already in place. Yet, for reforms to be successful, we need hardcoded reforms and higher and more productive investments. A lot of money is wasted on excessive administrative expenses, inefficiencies, the duplication of services, and fraud and abuse in insurance claims. It is now for the policy doctors to collaborate with the real doctors to come up with radical solutions that can build a healthier world for everyone.

(The writer is the author of Village Diary of a Heretic Banker. He can be reached at [email protected])